Edit: I got it now. Initially, I thought it was showing breakeven (e.g. cost per barrel) points for various countries. The graph isn't doing that. The graph is showing % of reserves that are viable at the price of $32.18/bbl by country. Interestingly, I heard on CNBC the other day that Saudi Arabia can pump oil and still make a profit at as little as $11/bbl.

Yes Saudi Arabia can breakeven at those low prices but in reality they still need oil at high prices because that is how they fund their country. So actually they need higher prices or they will have to cut there budget and no they don't want to spend less money.

The Saudis started their attack on fracking in the US with about $750,000,000,000 in cash reserves available to them. That is enough to sustain their government at current spending levels for 10 to 15 years. After that, well, who knows.

They have decreased subsidies to the subjects of the kingdom this year, and floated the idea of an IPO for some of their oil industry. Both actions make it obvious they can sustain low oil prices far longer than Venezuela, Russia, Angola, and other third world hellholes can survive, and far longer than banks will support US frackers.

What the Saudis expect to get out of this exercise in maintaining market share at lower prices eludes me, however. The math of lower prices and higher volumes does not make sense compared to higher prices and lower volumes, which can produce more $$$$ for them over the long term.

taking out producers just restricts the number of suppliers in the short run. it does not account for fluctuating demand side changes in preferences and needs.

R&D will still continue to develop more economic ways to extract oil, and the left over infrastructure from shut down operations will still exist.

but the uses of oil will slowly start to decrease, as technology will propel Green energy to become cheaper and cheaper. Consequently, this will reduce demand for oil even further, which will also have a negative effect on oil price.

its also important to note how much lost tax revenue that these governments can take before being forced to raise prices. most of these governments have

Look, Saudi Arabia didn't crash prices - the influx of oil from North American shale combined with weakened demand crashed price. If anything Saudi Arabia's production has stayed the same in recent years as domestic demand eats up marginal increases in production.

If oil becomes less profitable people are less likely to invest in it. And thus people may be more likely to invest in alternate sectors like renewables. It's a line of reasoning. This perspective is from the people creating the product, not buying it.

Most other sources of energy require vast amounts of subsidies to be economic with oil. Oil is probably the highest taxed commodity in the world,. I live in BC and pay $1.00 per litre for diesel, probably about 40 cents of this is tax. Some countries charge more than others. See http://www.globalpetrolprices.com/diesel_prices/

There is no known source for the cost of production of Saudi oil, only speculation.

It is also highly interesting that relative economies are not compared. How much of Saudi's low production cost comes from their currency being 1/3 of the USD. Is that estimated cost of production of $20 USD/barrel really $60/barrel due to the economic situation, or is the cost actually that low due to the properties of the wells and oil field.

You are mixing up currency value and labour productivity or per unit labour costs.

Cutting currency values can cut your per unit labour costs or increase your labour productivity (as measured in US dollars), but so can other things like letting in millions of migrant workers, or just the falling price of a major export.

Saudi certainly has massive foreign reserves and that lets them move their currency relatively easily, but as a practical matter the riyal isn't undervalued by a factor of 5. If the Saudis had to pay us wages maybe they would double costs, or maybe they would have to spend less on Ferrari's and luxury horses for the Royal family. Saudi nominal gdp per capital was between 20 and 25k in 2014, depending on when you count, so average wages including the portion sucked up by the Royal family are maybe half the US average, and that's with a relatively poor labour participation rate due to biases against women and the generous state pension system.

That is an excellent figure; once I figured out you can slide the grey arrow to see the change in viable/not viable reserves with changing price per barrel. Looks like it will be pretty easy for the OPEC countries to squeeze the oil future markets as other countries shut down operations due to lack of profitability. One more reason countries without easily accessible oil reserves need to continue developing alternative sources of energy.

Up in Canada since the price started crashing, overall the companies have been able to lower their price to produce a barrel down 11%. Let me try to find a source on that number. But when you see how much they are playing employees, it doesn't surprise me. Once you lay off 40000 people in a 12 month period, you get some cost savings.

I think some of the labelling is wrong.... I'm pretty sure the USA doesn't have 177 billion barrels of oil in its proven reserves... Unless they converted natural gas reserves into barrels of oil equivalent.

Slide the arrow on the top of the graph, the one with all the prices is USD. It indicates how much of the oil extracted in various countries is sustainable at each price point. When the price is high, you will see that for most countries pretty much all oil is worth extracting.

the largest decreases for Saudi Arabia are between $60-$40 and $40-$20, so I don't see them going above $60 anytime soon since this is to increase their market share. the largest increase for the US and Russia is between $40-60. from a logical negotiation standpoint, I think Saudi Arabia will push it down as close to $20 as long as they can then negotiate back up towards a $50-60 equilibrium under pressure from US and Russia as it starts affecting our own industries. but I don't see them making this bold move with the intention of going back to triple digit oil anytime soon. but then I'm just talking out my ass.

The interactive ability is the beauty. Unfortunately the data is not correct because costs are always moving due to efficiencies, cutbacks, foreign exchange movements and unknown information such as reserves etc.. (Just to name a few) But a good attempt at giving an interesting perspective

That is exactly why Saudi Arabia is being attacked by USA. The attack is ongoing already because the attack doesnt start in form of a war with weapons. First of all USA have to change SA's perception within the public to hate them so much that they can justify a war. USA will influence Saudi Arabia's perception within the public until public opinion about SA is so bad that eventually people will agree on a war or "liberation" of/against SA. This will take a while and it will get more and more complicated because of alternative media channels that cannot be controlled so well compared to classic propaganda mass media. So, my bet is on...

Iran on the other hand decided to play nicely with USA. They will be USA's new best friend and probably going to lead the war against SA. Same as usual...

First, the U.S. and Saudi Arabia have an extremely strong relationship. Just today, the New York Times wrote about how the CIA and the Saudis have been working together to fund Syrian rebels. They would provide money, the CIA training. And that barely touches the history of the Saudi Arabian and U.S. alliance. One of the reasons S. Arabia faced issues with terrorism and the U.S. the attacks on 9/11 was because S. Arabia allowed U.S. troops on it's land, the "Holy Land." We provided them security against Saddam Hussein (the guy who invaded Kuwait). The alliance also explains why the U.S. government is so reluctant to criticize human rights abuses (we said nothing about the execution of that major religious figure recently). Granted, our alliance in recent times is waning a tad bit, due to the Iran deal, but waning in the sense that we aren't blindly listening to the Saudis. We did promise the Saudis a bunch of military sales in return though, so they did eventually agree to the deal.

Also, if you're interested, the biggest arms sale in U.S. history was made in 2010 to Saudi Arabia (60.5 billion dollars); sourced from Jerusalem Center for Public Affairs (which was sourced on Wikipedia).

The only people 'attacking' Saudi Arabia are usually people criticizing its human rights abuses, and those are usually not the people who craft foreign policy in this government, or are in government at all.

Iran is not going to be our new best friend, given its major allies are Russia, the Syrian regime (and even after Assad, if the Russians get their way, it will be another Iranian-friendly President), and with time, even China (the leader is visiting Iran). Its interests in the region lie counter to ours (for example, security for Israel and the Gulf States). The deal is not indicative that we are new best friends, only that we are less hostile (and can communicate much easier). They released our sailors after a day, exchanged prisoners, sure. But recognize that our alliance with the Gulf States/Israel for the next few decades will take precedence.

I'm not sure where you are getting all these assertions--what news sources you've been reading lately? I'm simplifying myself, perhaps lacking detail, but you're following some completely alternate version of foreign policy/history

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